Apple building new downtown Reno facilities to support its iCloud data center

The struggling downtown of Reno, Nev., is about to get an infusion of investment when Apple begins construction of new support facilities to manage the iCloud data center now being built 20 miles away.

Apple in Reno

Apple initially opened its Braeburn Capital subsidiary in Reno in 2006, tasked with managing the company's rapidly growing pile of cash.

The company also operates a retail store in the Summit outdoor mall in the south end of Reno.

Apple's largest project in the area, however, is its new $1 billion iCloud data center that includes both a large, rural parcel of land within the nearby Reno Technology Park and plans to build new supporting facilities on the edge of downtown.

Will Apple turn off Reno's blight?

Reno's downtown is dominated by a string of major casinos, surrounded by a number of vacant older properties and lots of empty parking lots.

Efforts to enliven its downtown with a convention center, a regional transit facility, the Reno Aces baseball stadium and new condominium towers ran abruptly into an economic downturn that stalled further development.

Last year, the city, county and state worked together to approve a deal that welcomed Apple's investment with sales tax breaks (the state has no corporate taxes).

"This is the most significant economic news we've had in our region in over 15 years," proclaimed Greg Ferraro, the head of a public relations firm representing Apple at the meetings.

To earn those tax breaks, Apple agreed to not only build a new data center at the nearby RTP, but also develop supporting facilities for it within one of the most blighted areas of Reno's downtown named the Tessera District.

Reno's city government had earlier sought to lure in new development for Tessera by issuing STAR bonds backed by sales taxes, but several years later the area remained mostly empty lots and abandoned motels."This is the most significant economic news we've had in our region in over 15 years."

A few months after approving an incentives package for Apple, Reno's city council unanimously upheld a decision by the city's Planning Commission to deny a special use permit for a new strip club at Fifth and Eureka, a few blocks away from where Apple has plans to build.

Rejection of the strip club was noteworthy, given that downtown Reno is otherwise flush with adult entertainment, including the risqué Wild Orchid club south of downtown. Local journalists agreed that the rejection was likely linked to the Apple deal.

How much public funds are going to Apple?

The local television station, KRNV News 4, aired a report in January complaining that "after scoring $89 million of your tax dollars for the promise of bringing more business to Northern Nevada, Apple may be running behind schedule on the project construction."

The first problem with the report is that Apple didn't "score" an amount of "your tax dollars." Instead, the state exempted the company from paying taxes on sales related to the project.

"Critics often incorrectly cite the use of taxpayer dollars as the incentive when, in reality, all we really offered Apple is a discount on the taxes they will pay for a period of time," stated Mike Kazmierski, the head of the Economic Development Authority of Western Nevada in a report by SFGate.

"So, they pay less in taxes, but we don't give them any taxpayer dollars. The other option is to not reduce the taxes we take from them and end up with 100 percent of nothing."

Look at this, building data center after datacenter while Samsung is paying for people to come to tech sites and troll (and a few must be here), building factories for more tanks and missiles, making offers people can't refuse all over the world, selling 600 dollars phones because of 30 ads, and making 7 billion in profit.

(Who cares that apple makes much more and all others lose money! Fanboys!)

I have to hand it to you, Daniel. You're doing an excellent job of pulling all the pieces together on this one. You also deserve respect for resisting the urge to use the grabber headline: "Apple Demands Reno Kill Strip Club."

I know nothing about computer assembly, but could this downtown Reno site be used for the manufacturing jobs Apple is bringing back to the US? If it is a clean enough facility to assemble servers (as rumored above), then it definitely is clean enough to build Mac minis or Mac Pros.

I know nothing about computer assembly, but could this downtown Reno site be used for the manufacturing jobs Apple is bringing back to the US? If it is a clean enough facility to assemble servers (as rumored above), then it definitely is clean enough to build Mac minis or Mac Pros.

Look at this, building data center after datacenter while Samsung is paying for people to come to tech sites and troll (and a few must be here), building factories for more tanks and missiles, making offers people can't refuse all over the world, selling 600 dollars phones because of 30 ads, and making 7 billion in profit.

(Who cares that apple makes much more and all others lose money! Fanboys!)

I'm not sure as to your intent in this post.

Originally Posted by braeburned
I know nothing about computer assembly, but could this downtown Reno site be used for the manufacturing jobs Apple is bringing back to the US?

Both Tim Cook and President Obama have said that Apple is going to bring some "manufacturing" jobs back to the U.S. I had always assumed that it would mean nothing more than final assembly of the MacPro, since they don't sell that many of them.

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I also have to wonder whether Jobs would have supported the construction of an Apple facility in downtown Reno. He once killed an Apple Store on either 14th street or 23rd street (I forget which) in Manhattan because when he visited the area, he thought it was too sleazy. (Apple had also tried for a store near the Flatiron building, but abandoned the project after Community Board objections to the design. They eventually wound up with a store at 14th street and 9th avenue). Downtown Reno is pretty sleazy, even for a backoffice operation.

Originally Posted by zoetmb
Both Tim Cook and President Obama have said that Apple is going to bring some "manufacturing" jobs back to the U.S. I had always assumed that it would mean nothing more than final assembly of the MacPro, since they don't sell that many of them.

Heck, that's already done. My Mac Pro (2009) was "Assembled in USA".

Oh, and wasn't that handled when we started seeing the newest iMac design engraved with "something something USA"? Didn't that happen?

Will they be employing any actual Americans at the site? Hard to imagine Reno has the exact kind of engineers Apple will need. Either they move people in, train locals or bring in visa candidates. I wonder which.

Perhaps with the reduced sales tax for server's, not only can they build servers for the RTP, but they can build servers for Apple data centers in California and save the California sales tax? Don't know if that is legal/possible... Also, if the new site is building servers for other locations, keeping server assembly separate would reduce traffic in/out of the RTP data center improving security.

Will they be employing any actual Americans at the site? Hard to imagine Reno has the exact kind of engineers Apple will need. Either they move people in, train locals or bring in visa candidates. I wonder which.

Well, as a technology worker in Reno, I take exception to your remark. We have a fairly robust technology community here.